Interest in detection of factors consider responsible for uneven fluctuation in steady state growth of world economies is long standing. There has been an explosion of theoretical literature and empirical evidences which think about compassionate to resolve the issue. Hike in prices of goods and services and foreign exchange are two important aspects which believe to blame for such bumpy vacillation in economic growth of the world economies like all other political, social and economic factors. It is true that both factors have inimitable significance for economic growth, but inquiry about internal relationships of above said both variables still has research thirst.  The novelty of this research paper is, it provides the empirical evidence regarding the relationships between foreign exchange and inflation focusing on Pakistan experience since 1960. We use the Auto Regressive Distributive Lag Model (ARDL) proposed by Pesaran et al. (2001) in order to investigate the order of co-integration between inflation and foreign exchange through bound testing approach, and also use the OLS estimation to determine the long run relationship. Through econometric techniques, we trace the nature of relationship and speed of adjustment between concerned variables in response to fluctuation in level of foreign exchange. Empirical results indicate the negative correlation between the level of foreign exchange and rate of inflation in Pakistan during study period. 

The literature on EPZs shows that these are a second-best solution compared with generalised countrywide reforms, but that, where countrywide reforms are difficult to implement, they can be a useful weapon in the development arsenal [World Bank (2001)]. EPZs have been instrumental not only in increasing exports but also attracting export-oriented foreign direct investment (FDI). China is a classic example to be mentioned here where the levels of FDI have gone up massively over the last ten years. Added up with exports increase are also the benefits of employment generation, development of backward and forward linkages and strengthening the industrial base. The phenomenon of export-processing zones (EPZs) is a part of broader context of structural changes in global economic development. During the last few decades, there has been a tremendous increase in exports of manufactured goods especially from developing countries. EPZs have emerged as an important channel of export generation, especially of manufactured goods, from most of the developing countries e.g. East Asia, Mexico, Morocco etc. Their significance cannot be undermined because of the location-specific advantages and infrastructure facilities possessed by them.

This article is an attempt to calculate the Data Envelopment Analysis (DEA)efficiency scores and productivity indices of banks in Saudi Arabia. Our DEA results indicate that technical inefficiency emerges from both scale as well as pure technical inefficiencies. The results on Malmquist Productivity Index (MPI)reflect an improvement in average productivity of banks. However, the major source of productivity gain was the efficiency change relative to technological change. The banks in the Kingdom appear to have succeeded in catching up with the best performance, even though the average scores on technical efficiency (TE)stood beyond optimality. Implications of the study reveal that countries like Saudi Arabia need to accelerate and diversify resource mobilization efforts extensively, suggesting banks to go beyond deposits as the main source of resource mobilization. The existing monopolistic type of banking sector needs to be transformed into a competitive one, enabling banks to look for optimality and competitiveness simultaneously. There is also a need to diversify the sources of gross domestic product (GDP)both nationally and internationally. This would immune the banking system from the swings emerging through changes in the oil prices and quotas.

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Purpose -This paper aims to estimate the cost efficiency scores of banks in KSA before and during financial crisis by using a data envelopment analysis (DEA) approach. Design/methodology/approach -The study uses the intermediation approach of banking services where banks are considered as manufacturing units. The research methodology consists of cost efficiency DEA and a second stage Tobit regression model. Findings -The results reveal that banks in KSA are least affected by the crisis as the efficiency scores remain the same during all the periods. However, the average levels of inefficiency remain higher suggesting that KSA banks are lagging behind in exploiting the resources fully. The major source of cost inefficiency stems from allocative inefficiency rather than the technical one. Results of the Tobit regression also disclose that the impact of financial crisis across bank efficiency remains weak and inconclusive.Research limitations/implications -The study bears some useful managerial implications for various stakeholders. Although banks do not seem to be affected by the crisis, yet they need to improve their efficiency since the levels are far below the frontier. For successful existence and growth of banking, it remains vital that these banks control their costs regardless of the fact are operating in a concentrated market. Practical implications -The paper suggests that the banks in KSA need to bring down their operating expenses to reach the efficiency frontier. The average level of inefficiency (82 per cent) reflects a greater amount of input waste which needs to be controlled by these banks. Originality/value -The study is novel in a way that it evaluates the cost efficiency performance of KSA banks before and during the financial crisis, followed by a second stage regression on the determinants of cost efficiency. It provides valuable insights to both the bank managers and public policy makers who can look for the optimal levels of efficiency and competitiveness of Saudi banking sector.

To date no study has been made to explore the FDI motives of foreign firms in Pakistan. An attempt has been made to rectify this position through a survey of both wholly- and majority-owned multinational enterprises (MNEs) in the economy. Market size and growth variables appear to be the most cited reasons for FDI by MNEs in the sample. The use of exploratory factor analysis (EFA) also reinforces the significance of market size as the motive for FDI in Pakistan. The other underlying factors produced by the EFA are: expansion of business, low input prices, desire to lower the transaction costs and psychic distance.

This study proposes to fill the gap in the literature available by examining the factor affecting the expansion of foreign banks in Pakistan. It takes an overview of the trends and dynamics of the activities of foreign banks in the economy. An investigation is made to explore the factors that motivate foreign banks for doing busi ness in Pakistan. Findings of the survey reveal the fact that profitability, trade financing, following the clients, diversifying the risk and market size are important factors for the presence of foreign banks in the country.

PurposeThe purpose of this paper is to estimate the data envelopment analysis (DEA) efficiency scores and Malmquist productivity indices of banks in Saudi Arabia, an economy that is heavily dependant on the hydrocarbon sector.Design/methodology/approachThe paper adopts the intermediation approach of banking services where financial institutions like banks are perceived to be manufacturing units, employing inputs such as interest and non‐interest expenses to produce outputs such as net interest and non‐interest incomes. The research methodology is comprised of the DEA and Malmquist productivity index (MPI) as a measure of change in total factor productivity, reflecting industry's performance over time.FindingsThe results on MPI reflect an improvement in average productivity of banks. However, the major increase in productivity gains emerged through technological change relative to the efficiency change. The banks across the Kingdom appear to have succeeded in catching up with the best practices, even though the average scores on technical efficiency (TE) stood beyond optimal levels.Research limitations/implicationsThe question, whether small banks are more productive and efficient vis‐à‐vis large banks, remains unanswered. Likewise, to what extent the changes in oil prices and revenues affect the efficiency and productivity of banks, a second‐stage regression of efficiency on oil prices and revenues along with other variables would help in calculating the degree of impact. However, these are the agenda for subsequent research.Practical implicationsThe banks in Saudi Arabia need to rationalize their costs to line up across the efficiency frontiers.Originality/valueThe paper manages to explore the critical issues of TE and productivity changes across the banking sector in Saudi Arabia. It provides valuable insights to both the bank executives and public policy makers, who are seeking for improvements in efficiency, productivity, and competitiveness across the banking sector in the Kingdom.